Africa’s ecommerce startup ecosystem is increasingly seeing more investments as a result of the coronavirus pandemic. Egypt’s B2B ecommerce marketplace Fatura has raised seven-figure (USD) seed round led by Egyptian fintech-focused VC Disruptech, the startup announced in a statement without disclosing the exact size of the investment.
“Egypt has more than 5,000 wholesalers, investing heavily to build another one will not solve the existing inefficiencies at scale. This capital-intensive approach never made sense to us in light of the Egyptian market’s realities. Alternatively, we are on a mission to curate a network of 200–250 wholesalers across the country, digitally transform the way they work and enable them to collectively lead the FMCG distribution business nationally,” Hossam Ali, the co-founder and CEO of Fatura, who was previously a Management Consultant with McKinsey, explaining this, said.
Here Is What You Need To Know
- Joining VC Disruptech in this round were other local investors including EFG EV & Cairo Angels.
- With the new funding, Fatura will expand into lending solutions. The startup said in a statement that is on its way to offer working capital loans to retailers that are part of its network.
“Around 60% of the current wholesale market in Egypt is through on-credit purchases. We will be the first player to unlock the opportunity of digitizing the lending cycle,” said Ahmed Anwar, Fatura’s co-founder and COO.
Why The Investors Invested
The investment was made by VC Disruptech, founded by one of Egypt’s most successful fintech startups, Fawry’s co-founder and former managing director Mohamed Okasha and ‘leading finance guru’ Malek Sultan. In 2019, the VC established an Egypt-focused $25 million fintech fund and subsequently made its first two investments in Khazna & Brimore. Adding a B2B ecommerce segment to the VC’s portfolio is a strategic way the VC seeks to position itself for a post-pandemic future as it seeks to justify investors’ commitments to its funds.
“We are excited to lead Fatura’s investment round and we firmly believe in the opportunity that lies in the digitization of the wholesale-retail relationship. Disruptech sees Fatura playing an essential role to transform the market and we are committed to helping Fatura achieve its mission,” Mohamed Okasha, the founding partner of Disruptech, said.
Going after B2B ecommerce may also be a strong game plan as investors across the Middle East and North Africa seem to have seen a big opportunity in that segment. B2B ecommerce startup Sary from Saudi, and Bazaar (also co-founded by a former McKinsey consultant) & Tajir from Pakistan are some of the players that have raised investments in the last three months or so. MaxAb, the Egyptian player that has been in the market for about two years and raised $6.2 million in region’s largest seed (at the time) is also in the process of closing another round.
A Look At What The Startup Does
- Founded in 2019 by Hossam Ali, Ahmed Anwar, Abdullah Mohebeldi, and (later joined by) Ahmed Al Bakary, Fatura connects ‘curated’ wholesalers in the Fast Moving Consumer Goods (FMCG) space with the retailers through its mobile application, enabling them to order the inventory for their stores. It claims to have over 1,500 SKUs on its platform.
- The startup that aims to become the largest ‘e-wholesaler’ in Egypt & Africa says it uses underutilized assets already owned by the wholesalers to resolve existing supply chain inefficiencies for all relevant stakeholders including retailers, wholesalers, and manufacturers.
- Put simply, Fatura is an online marketplace focused on getting orders to existing wholesalers and have them ship these orders using their own fleet. That is, Fatura neither stores the inventory nor delivers it itself.
“A major value of the platform is the market data analysis and the AI-enabled decision making based on it. We help FMCG manufacturers to make better data-driven decisions and provides unprecedented transparency on prices and stock levels to retailers to maximize their profits,” Abdullah Mohebeldi, the co-founder and CTO of Fatura said.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer.